Method and device for generating a single-use financial account number

ABSTRACT

A device for facilitating financial account transactions is described which includes a processing unit including a cryptographic processor. The device also includes an input unit, a display unit and a memory device connected to the processing unit. The memory device contains a private cryptographic key, a first data element and a second data element. The processing unit encrypts the first data element using the private cryptographic key and the second data element, modifies the second data element, combines the encrypted first data element and the second data element to generate a single-use financial account identifier, and displays the single-use financial account identifier. This identifier is then transmitted to a central processor for authorization of the transaction. The central processor extracts and decrypts data elements from the transmitted identifier using the private cryptographic key, compares those data elements with data elements stored in a memory, and verifies the single-use financial account identifier in accordance with the comparison.

BACKGROUND OF THE INVENTION

This invention relates to a method and a device for generating asingle-use, transaction-specific financial account number, therebyproviding a high level of security for financial transactions,particularly credit card transactions.

There are over 500 million general purpose, retail, oil and other creditcard accounts in the United States (hereafter called “cards”). Worldwidethe figure is almost 1 billion such cards. Typically, each authorizeduser of an account is issued a credit card: a physical plastic objectwith an embossed account number and cardholder name appearing on itsface. Anti-counterfeiting indicia, such as holograms, photographs orsignatures, may also appear on the card to discourage wrongful usage.

Since the credit card number is unchanging, there is a risk offraudulent use by anyone who steals the number. The key element ofdefense against a fraudulent user impersonating the authentic cardholderis signature verification. A signature area appears on the back of mostcards, and when a person receives a new credit card, he is instructed tosign his name on the back of the card. A merchant who accepts the cardwill then be able to compare the signature specimen that appears on theback of the card to the signature on the sales draft signed by theconsumer at the time of purchase. In some cases, the merchant may alsoask for photo ID before accepting the card or as a method of checkingthat the signatures are for the person whose name appears on the face ofthe card.

In addition to examining the signature on the card, most merchants whoaccept credit cards use a small device known as an authorizationterminal. The authorization terminal is capable of reading informationdisposed on a magnetic stripe located on the back of the credit card insome cases, this stripe also contains other difficult-to-counterfeitinformation. To process a credit card purchase, the merchant passes thecard through the magnetic stripe reader of the terminal and enters theamount of the purchase. The information is then sent by the device overa phone or wireless connection to a central database for account numberverification and purchase authorization. A card that has been reportedlost or stolen is declined. If magnetic stripes on credit cards becomedamaged and unreadable, the authorization terminal permits manual entryof the credit card number as it appears embossed on the face of thecard.

With the dramatic growth of direct marketing, an increasing share of allcard purchases are being made without the physical presentation of thecard to the selling merchant. Instead, the consumer simply relays thecard number to the merchant, and the merchant enters the card numberinto a computer terminal which is also designed to handle the orderprocessing function. As electronic commerce grows over the next decade,the percentage of such remote, non-face-to-face purchases can beexpected to grow. This poses an increasingly acute problem for theentire credit card system, since credit card numbers are highlyinsecure.

To protect against thieves fraudulently creating credit card numbers andthen using them for remote purchasing, a check-digit algorithm istypically employed for credit card account numbers which makes itcomparatively difficult (approximately 1 chance in 500,000) to pick arandom 16-digit number that is also a valid credit card account number.In addition, since not every valid credit card account number iscurrently in use, simply making up a valid number is, in itself, notenough to get an authorization code from the central authorizingnetwork. In addition to passing the check-digit test, a bank must haveissued that number to an active customer.

To further help combat mail-order based credit card fraud, both Visa andMasterCard have deployed databases that allow a merchant to verify thata given credit card account number is connected to a specific billingaddress. Visa calls this service the Address Verification Service. Thetheory behind the service is that a thief (for example, a dishonestrestaurant waiter) might be able to use a credit card receipt slip tosteal an active account number, but if he tries to use that number for amail order purchase he would not know the correct address associatedwith that number. Even if a thief were to obtain the cardholder'saddress, this service can allow a merchant to compare the shippingaddress of the catalog order to the current billing address for thataccount number and thus possibly identify any suspicious activity.

Currently, credit cards also incorporate an expiration date after whichthey are no longer valid. These dates are typically one to two yearsafter the card is issued. The reason for an expiration date is to reducethe issuing bank's risk of cards being presented after an account isclosed. Since the expiration date is an absolute indication of whetheror not to accept a card, an old card that is lost or misplacedeventually expires with minimal risk that it will be found and usedimproperly.

In addition, credit card information and transaction information may beencrypted using well known encryption schemes like RSA's public keycryptography. For example, SET is a joint Visa/MasterCard standard forencrypting credit card numbers transmitted over the Internet.

In spite of these safeguards, credit card security is vulnerable to anumber of attacks by unscrupulous persons. Some examples of theseattacks are as follows:

a) Theft of cards: Any conventional credit card which is stolen can bemisused, either at a merchant's establishment by forging the signatureon the card onto a sales slip, or by ordering merchandise or servicesremotely.

b) “Sniffing:” Credit card transaction information being transmittedover public networks can possibly be intercepted and captured or“sniffed.” The sniffed information can then be used to createcounterfeit cards and/or order goods and services. For example, if ahacker were to break the SET encryption scheme, the hacker could sniffout credit card numbers and misuse them. Re-submission of the sniffedencrypted credit card numbers to the same merchant is known as “replay.”

A large-scale attack on credit-card number security would threaten theentire credit card system. For example, if someone were to steal 1million active credit card account numbers, and were also able to stealthe billing addresses to which those cards were issued, the entirecredit card system would be threatened. At the very least, mail ordersales might have to be suspended until new safeguards were put in place.At worst, a flood of counterfeit cards, with correct account numbers andvalid names embossed on their faces, could be created.

With the advent of almost instantaneous worldwide money transfers, aband of organized thieves could clear hundreds of millions or evenbillions of dollars of charges through the authorization system and thenwire that money to a safe haven before cardholders suspected that theircards had been charged an unauthorized amount. If the theft alsoinvolved data revealing each account's unused available credit line,such criminal activity might be even harder to detect before it was toolate to rescind the wire transfers of stolen money.

Cards which store information, as opposed to merely having embossednumbers, are known in the art. Such “smart cards” are becomingincreasingly common. These cards contain a small microprocessor capableof storing data in a secure fashion and of performing computeroperations on such data. Smart cards may have built-in small numericdisplay screens. In particular, smart cards used for distribution ofcryptographic keys, display keys on their display screens.

Smart cards are used to authenticate card users and to authenticate thecard/user combination to a third party. These cards are also used forcontrolling access to computer systems and databases and entry intosecure areas. Northern Telecom offers a credit card sized smart cardcalled Entrust which contains a microchip that stores encoded, privatekeys. Hardware tokens such as Security Dynamics' SecurID card use a“time synchronous methodology” to produce passwords every 30 seconds.

Wire transfer calculator-style devices are also known in the art. Suchdevices are the size of a credit card and contain a tamper-resistant“secure perimeter” within which is disposed a clock and acryptoprocessor. These devices also have a small LCD alpha-numericdisplay screen and a numeric keypad for data entry.

A number of security devices and methods involving credit cards havebeen disclosed. For example, U.S. Pat. No. 5,311,594, “Fraud ProtectionFor Card Transactions,” describes a challenge-response method for fraudprotection wherein credit card holders are authenticated based on theirresponses to randomly asked questions like their mother's phone number,their graduation year, birth date, etc. The responses are checkedagainst prestored information in a database.

U.S. Pat. No. 5,457,747, “Anti-Fraud Verification System Using a DataCard,” describes a biometric system for deterring credit card fraud.Credit cards have two magnetic stripes, one that has been permanentlyencoded with the card holder's biometric information and one that an ATMcan write onto. To use the card, the card holder supplies the samebiometric information at a verification terminal. The terminal checksthe biometric information supplied by the card holder against thatrecorded on the magnetic stripe. If the biometrics match, the terminalwill write a transaction authorization onto the magnetic stripe.

U.S. Pat. No. 5,485,519, “Enhanced Security For a Secure Token Code,”describes a method for enhancing security for a private key stored in asmart card. A user input PIN is combined algorithmically with a coderesident in the smart card to produce the private key. The private keyis not stored in the smart card except for short intervals when the cardis actually being used by an authorized user who has input his PIN.

SUMMARY OF THE INVENTION

This invention provides a method and a device to facilitate secureelectronic commerce, secure remote credit card purchases, and secureconventional credit card purchases wherein the customer is assured thatthe merchant or an intercepting third party cannot misuse any creditcard information.

According to one aspect of our invention, a method for generating asingle-use financial account identifier is provided which includes thesteps of accessing a first data element specific to an account;accessing a second data element including transaction-specific data; andcombining the first data element and the second data element to producethe single-use financial account identifier.

According to another aspect of our invention, a device for facilitatingcredit transactions is provided which includes a processing unitincluding a cryptographic processor. The device also includes an inputunit connected to the processing unit for inputting information thereto,and a display unit connected to the processing unit for displaying aprocessing result. In addition, the device includes a memory deviceconnected to the processing unit. The memory device contains a privatecryptographic key, a first data element, a second data element and aprogram adapted to be executed by the processing unit. In accordancewith the program, the processing unit encrypts the first data elementusing the private cryptographic key and the second data element,modifies the second data element, combines the encrypted first dataelement and the second data element to generate a single-use financialaccount identifier, and displays the single-use financial accountidentifier using the display unit.

According to a further aspect of our invention, a system for verifying afinancial account identifier is provided which includes a processingunit including a cryptographic processor. The system also includes acommunications unit, connected to said processing unit, for transmittingand receiving information regarding the financial account identifier,and a memory device. The memory device-contains a private cryptographickey, a first data element, a second data element and a program adaptedto be executed by the processing unit. In accordance with the program,the processing unit receives a single-use financial account identifier,extracts therefrom a third data element and a fourth data element,decrypts the third data element using the private cryptographic key andthe fourth data element, compares the decrypted third data element withthe first data element in a first comparison, compares the fourth dataelement with the second data element in a second comparison, andverifies the received financial account identifier in accordance withthe first comparison and the second comparison.

According to still another aspect of our invention, a method forproviding a single-use financial account identifier includes the stepsof: providing a memory storing data representing a plurality ofpredetermined single-use financial account identifiers, datarepresenting a status for each single-use financial account identifier,and data representing a pointer to one of the single-use financialaccount identifiers; identifying the single-use financial accountidentifier based on the pointer data; and transmitting a signal to anoutput device to present the single-use financial account identifier.

According to a further aspect of our invention, a device for providing asingle-use financial account identifier is provided which includes amemory, an output device and a processor coupled to the memory and tothe output device. The memory stores data representing a plurality ofpredetermined single-use financial account identifiers, datarepresenting a status for each of the predetermined single-use financialaccount identifiers, and data representing a pointer to one of thepredetermined single-use financial account identifiers. The outputdevice presents the single-use financial account identifier. Theprocessor is configured to identify the single-use financial accountidentifier based on the data representing a pointer, and to transmit asignal to the output device to present the single-use financial accountidentifier.

BRIEF DESCRIPTION OF THE DRAWINGS

FIG. 1 is a block diagram of the hand-held smart card device inaccordance with the present invention.

FIG. 2 is a block diagram of the device's central processor.

FIG. 3A is a block diagram of the overall system of the presentinvention.

FIG. 3B is a flowchart showing the basic method of the presentinvention.

FIG. 4 is a block diagram of the credit card issuer's central processor,with databases as used in accordance with the first embodiment of theinvention.

FIG. 5 shows in tabular form the credit card account holder database.

FIG. 6 shows in tabular form the account holder secret key database.

FIG. 7 shows in tabular form the credit card transaction databaseaccording to the first embodiment of the invention.

FIG. 8 is a flowchart describing an encryption scheme used to generate asingle-use credit card number in accordance with the first embodiment ofthe invention.

FIGS. 9A and 9B are connected flowcharts describing the operationsperformed by the central processor of a credit card issuer to generatean authorization code, in accordance with the first embodiment of theinvention.

FIG. 10 is a flowchart describing the operations performed by a deviceto generate and display a single-use credit card number, in accordancewith a second embodiment of the invention.

FIGS. 11A and 11B are connected flowcharts describing the operationsperformed by a credit card issuer's central controller to generate anauthorization code, in accordance with the second embodiment of theinvention.

FIG. 12 is a block diagram of the credit card issuer's centralprocessor, with databases as used in accordance with the secondembodiment of the invention.

FIG. 13 shows in tabular form the credit card number database.

FIG. 14 shows in tabular form the credit card transaction databaseaccording to the second embodiment of the invention.

DETAILED DESCRIPTION OF THE PREFERRED EMBODIMENTS

FIG. 1 is a schematic diagram of a device 100 for generating asingle-use credit card number in accordance with this invention. Thisdevice is preferably a smart card, hereinafter referred to as the“device.” The device has a keypad 103, a display screen 102, a memory104 and a central processor 101. Memory 104 contains a key 601, and CPU101 contains a cryptographic processor. The device may be activatedthrough the input of a unique cardholder identifier such as a personalidentification number (PIN) through the keypad 103. Alternatively, thedevice may include a biometric interface 105, and be activated by theinput of a suitable biometric record such as the cardholder'sfingerprint.

FIG. 2 is a schematic diagram showing further details of the centralprocessor 101 of device 100. The central processor 101 includes amicroprocessor 201. The microprocessor 201 is connected to a clock 202,a random-access memory (RAM) 203, a read-only memory (ROM) 204, and acryptographic processor 205. In addition, the microprocessor 201 isconnected to the keypad 103 for receiving input from the user and to thedisplay 102 for prompting the user or displaying information.

FIG. 3A is a schematic diagram of the environment in which the methodand system of the present invention are used. A cardholder 301, wishingto purchase goods or services from a merchant 302 (not necessarily inperson), transmits a single-use credit card number 300 to the merchant.The merchant 302 transmits the single-use credit card number 300 to acredit card issuer 303. The credit card issuer 303 returns anauthorization 310 to the merchant, based on which the merchant deliversthe desired goods or services 320 to the cardholder.

FIG. 3B shows the steps of the basic method of using the device inaccordance with the present invention. To purchase goods or services inperson, via telephone or via the Internet, cardholder 301 uses device100 to generate a transaction-specific, single-use credit card number.The cardholder first inputs his PIN or biometric data to access thedevice (step 351). If access is granted, the device responds by queryingthe cardholder on display 102 whether it should generate a single-usecredit card number (step 355). The cardholder responds by requestinggeneration of a credit card number (for example, by keying “YES”). Hemay optionally be asked to enter the amount of the purchase in step 356or a merchant code number provided by the merchant. This number could beonly a few digits long since it does not have to be unique to eachmerchant.

The device then generates a single-use credit card number (step 360);details of the card number generation are explained below. The number isunique for the specific input variables set by the cardholder or by thedevice. It may also be unique to the specific date and time to avoidso-called “replay” attacks for that card at that merchant with thatexact purchase amount. The single-use credit card number is preferably a16-digit number that can be recognized as a conventional credit cardnumber.

The cardholder transmits the single-use number to the merchant (step361), and the merchant enters the single-use number into anauthorization terminal connected to a central credit card processingsystem maintained by the credit card issuer (step 362). A check digitmay be included in the number to prevent the incorrect keying of thenumber. The number is sent to the credit card processing system forauthorization (step 363). The central system processor maps thesingle-use credit card number onto a conventional credit card accountand determines whether the transaction is authorized (step 380); if so,the central system returns an authorization code for display on themerchant's authorization terminal (step 390); if not, the central systemtransmits an authorization failed message for display on the merchant'sauthorization terminal (step 395).

Throughout this discussion, the term “credit card number” refers to anumber that is used only one time to perform a specific transaction, andis generated using the device 100; in contrast, the term “accountnumber” refers to an unchanging identifier for the cardholder which isstored in a database maintained by the card issuer.

First Embodiment (Device Private Key Encryption)

In this embodiment, the single-use credit card number is generated bythe device cryptoprocessor 205, using a private key 601 stored in thedevice memory 104 (preferably the ROM 204). The encryption data changeswith each use of the card, so that the single-use encrypted credit cardnumber is different for each transaction. This credit card number isdistinct from the unchanging account number identifying the particularcardholder. It should be noted that knowledge of the account number doesnot allow an attacker to generate a valid single-use credit card number.

When the single-use credit card number is transmitted to a merchant, themerchant passes the number to the card issuer's central processor forauthorization. The central processor decrypts the number based on aknown algorithm, determines the true account number, and eitherauthorizes or denies the charge.

FIG. 4 is a schematic diagram of the credit card issuer's centralprocessor 400. The processor includes a central processing unit (CPU)401. The CPU is connected to a clock 402, a random-access memory (RAM)403, a read-only memory (ROM) 404, a cryptographic processor 405, and acommunication port 406 for communication with the merchant's centralprocessor. In addition, the CPU 401 is connected to a storage device410, which includes a credit card account holder database 411, a creditcard account private key database 412, and a credit card transactiondatabase 413.

The data structure of the credit card account holder database 411 isshown in FIG. 5. Each record in the database includes the cardholderaccount number 501, the cardholder's name 502, address 503 and telephonenumber 504, the original credit line 505 associated with the account,the amount of credit currently available (available credit line 506),and the expiration date 507.

FIG. 6 shows the fields of the credit card account private key database412. Each entry of this database has the cardholder private key 601 andthe associated cardholder account number 501. The private key is thusstored in both the device memory 104 and the database 412. An additionalsecret piece of information, called a “nonce” 602, is associated withthe account number. The nonce is also stored in the device memory 104.The nonce need not be as long as the account number, but should not beeasily derived therefrom.

FIG. 7 shows the fields of the credit card transaction database 413.Each record of this database corresponds to one transaction using thecard, and includes the account number 501, the expiration date 507 ofthe card, the transaction amount 702, the merchant identification number703 and an initialization variable 704. The initialization variable 704is used to ensure that each credit card number is unique to theparticular transaction, thereby preventing a “replay” attack.

In this embodiment, the device memory 104 has stored therein the privatekey 601, the nonce 602, the initialization variable 704 and the accountnumber 501. The initialization variable is set at 0 (zero) when the cardis newly issued, and is incremented each time a single-use credit cardnumber is generated.

The cryptography described herein requires binary data. Current creditcard numbers are 16-digit decimal numbers. Since 10¹⁶ is only slightlygreater than 2⁵³, nearly every such decimal number may be represented bya 53-digit binary number. Therefore, in the following discussion it willbe assumed that the credit card number is a 53-bit number and that it isthen converted to a 16-digit decimal number for transmission or display.

A credit card number consists of an m-bit initialization variable(abbreviated IV), an a-bit account number, and an n-bit nonce(abbreviated N), where m+a+n=53. It should be noted that the nonce maytake the place of the check code employed with conventional credit cardnumbers. If n=16, then the probability that an attacker can generate avalid credit card number is 1 in 2^(m)=65536. The parameter n can bevaried to change the probability as desired.

The parameters m and a do not necessarily have to be the same size forall credit card holders. However, m should be large enough for anyindividual cardholder so that he does not use his credit card more than2^(m) times before the card expires. For most credit card holders avalue of m=9 would probably suffice, allowing use of the card 512 times(that is, 5 times a week assuming the card is valid for two years)before it expires.

The steps for generating an encrypted single-use credit card numberaccording to this embodiment are shown in FIG. 8. In step 801, thedevice central processor 101 retrieves the nonce 602 and theinitialization variable 704 from the device memory 104. In step 802, thenonce is encrypted using the user's private key K and the IV. ThusC=E _(K)(N, IV)where C represents the encrypted nonce. Both N and C are n-bit values.

The central processor 101 then retrieves the account number from thedevice memory 104 (step 803). In step 804, the encrypted nonce C, theinitialization variable IV, and account number A are concatenated toform an encrypted, single-use credit card number CCN:CCN=C _(—) IV _(—) A, where_denotes concatenation.

The initialization variable is incremented and the result is stored inthe device memory 104 (step 805):IV=IV+1

The resulting credit card number CCN is then displayed on the displayscreen 102 (step 806) and read, shown or otherwise transmitted to themerchant. The merchant transmits this number to the issuer's centralprocessor 400 for authorization of the transaction.

FIGS. 9A and 9B show the steps for generating an authorization code forthe transaction. In step 901 the issuer's central processor 400 receivesthe single-use credit card number transmitted by the merchant.

To verify the card number, the credit card issuer's central processorfirst extracts the encrypted nonce C, the initialization variable IV,and account number A from the credit card number (step 902). Theprocessor then retrieves the extracted account number from thecardholder account database 411 (step 903), and determines whether theaccount number is valid (step 904). If the account number is not valid,the transaction is aborted (step 905). If the account number is valid,the processor looks up the account number in the credit card transactiondatabase 413 to determine whether the card holder has previously usedthe initialization variable IV (step 906). If the cardholder has doneso, the transaction is aborted (step 908). If the initializationvariable has not been used, the incremented initialization variable isstored in the credit card transaction database 413 (step 908).

In step 921, the processor retrieves the card holder's private key K inthe private key database 412. The private key K then is used to decryptthe encrypted nonce (step 922). This recovers the original nonce N:N=D _(K)(C, IV).

The decrypted nonce N is compared against the nonce 602 stored in theaccount private key database 412 (step 923). If they match (step 924)then the credit card number is considered valid; otherwise thetransaction is aborted (step 925).

If the card is found to be valid, and if the cardholder's account meetsthe credit card issuer's approval criteria (step 926), then the issuer'scentral processor generates an authorization code and transmits the codeto the merchant (step 928). If not, then the transaction is aborted(step 927).

Approval criteria are issuer specific and may include, but are notlimited to, the following: account must be in good standing (not pastdue); sufficient credit must be available (some issuers may approvepurchases that exceed available credit by a specified margin), the cardshould not have been reported stolen/lost; and the account should not beclosed.

There are two types of ciphers which can be used to encrypt the data (inthis embodiment, the nonce N and initialization variable IV): streamciphers and block ciphers. Stream ciphers can be used with minormodification so that different initialization variables will result indifferent ciphertext. The amount of information that must be encryptedin this system is smaller than the blocksize of most block encryptionalgorithms. However, a modified variant of Cipher Feedback Mode may beused to encrypt small amounts of data and has some additional securityfeatures.

Accordingly, one possible encryption method uses a stream cipher.Conventional ciphers use a secret key k to produce a stream of data. Thedata is then combined with the unencrypted data (e.g. by XORing themtogether) to produce the encrypted text. On the other hand, to encryptan n-bit value N using initialization variable IV and key k, a streamcipher may be used to generate n(IV+1) bits of data, with N thencombined with the last n bits of the resulting data.

Another way to encrypt the data is to use a block cipher in 1-bitfeedback CFB-mode. However, this has some undesirable properties whichmay allow an attacker to deduce the unencrypted form of encrypted data.While an attacker cannot generate a valid credit card number withoutknowledge of the user's private key, knowing the user's nonce underminesthe security of the account. To avoid this problem the following variantmay be used:

1. The input of the block cipher I_(i) consists of the IV concatenatedwith a 1-m bit shift register (where m is the number of bits in the IVand we are using a 1-bit block cipher). Let S_(i) be the state of theshift register. ThenS ₀=1andI ₀ =IV _(—) S ₀.In fact,I _(i) =IV _(—) S _(i)for all i.

2. Bit i of the encrypted data is computed asC _(i) =f)I _(i) , k)₀ ⊕P _(i)

where f is the encryption function of the block cipher and f(I/k)₀denotes bit 0 of the encryption of I with key k.

3. The shift register is updated with the ciphertext so thatS _(i+1)=(S _(i)<<1)_(—) C _(i)

where S<<1 denotes shifting S left 1 bit.

To decrypt the data a nearly identical algorithm is used except thatP_(i) and C_(i) are reversed. So the second step of the algorithm is allthat changes and it becomes:

2′) Bit i of the decrypted data is computed asP _(i) =f(I _(i) ,k)₀ ⊕C _(i)

where f is the encryption function of the block cipher and f(I,k)₀denotes bit 0 of the encryption of I with key k.

Suitable block ciphers include Triple-DES, IDEA and Blowfish. Suitablestream ciphers include RC4, SEAL and A5. All of these algorithms arediscussed in B. Schneier, “Applied Cryptography,” John Wiley & Sons, 2ded. 1996.

The primary defense against replay attacks in this embodiment ischecking that the same initialization variable IV is not used twice forany particular account number. When the credit card is issued theinternal IV is preferably set to 0. Each time the credit card is usedthe IV increments by 1. Therefore, as long as the cardholder does notuse the credit card more than 2^(m) times (where the IV is m bits long)the same initialization variable will never be repeated. Preferably, thecredit card issuer keeps track of the IVs that the card holder has used.This can be done with a simple bit array where entry a of the arrayindicates that IV a has been used if and only if it is set to 1.

As stated earlier, m=9 is probably sufficient for most cardholders. Thismeans that the card issuer needs only keep track of a 512-bit array foreach such credit card. This is very inexpensive. In addition, if theissuer notices that the cardholder has nearly exhausted his IVs, then itcan issue the cardholder a new card.

Another attack against this system would be to flood the central serverwith bogus credit card numbers (otherwise known as a denial-of-serviceattack). One way to make this attack more difficult is to spread theauthorization processing load across several servers which all have thecapability of verifying a credit card number. If they receive a validcredit card number, they can coordinate with the central server toperform the credit card transaction.

Ideally, the load should be spread evenly across several differentservers. A simple way to do this is to set up p servers and assign eacha unique number in the range 0 to 2^(P)-1. Next, for every credit cardnumber that must be verified, check a prespecified set of p bits of thecredit card number and assign the verification to the server with thecorresponding number. For example, if the p specified bits of the creditcard number give “14,” assign the verification to the server numbered“14.”

For the primary embodiment, there are 2⁵³ possible credit card numbers.A central authority might be established to assign ranges of accountnumbers to individual credit card companies. Once a company receives anr-bit range of account numbers it may further split the range of numbersup as desired. Ultimately the issuer should decide upon the size of thenonce (n bits), the account number (a bits), and the size of the IV (mbits) so that n+a+m=r. Note that the account number should include thosebits assigned by the central authority. Also, different card holders canhave different values of n, a, and m even if they receive their cardsfrom the same credit card company.

After a cardholder's card expires, his account number can be reused. Thenext credit card issued with that account number would use a differentnonce and private key. This will ensure that any credit card numbersgenerated with the old credit card will not match any new credit cardnumbers with better than random chance.

In an alternative to the present embodiment, timestamps could beincluded with the nonce during encryption. Then, credit cards could beused in conjunction with a clock. When creating the credit card thecredit card issuer should start the clock at 0 and note the offset fromits own clock, storing the difference with the card holder's accountinformation (for example in the database 411). Then when a credit cardissuer desires to validate a timestamp created by the credit card, itmay simply add the timestamp to the offset stored with the card holder'saccount and then compare the result against its own clock. If the timefalls within a specified time window then the timestamp should beconsidered valid.

In order for the credit card issuer to verify a single-use credit cardnumber, it must know to which account the credit card number belongs.Instead of encoding the account number as part of the credit cardnumber, the name that appears on the card could take the place of theaccount number. In that case every credit card must have a differentname printed on the card. The trade-off in this instance is that manymore bits become available in the credit card number since they are notused to encode the account number. They can then be used to encode atimestamp, purchase information, or even merchant information.

Second Embodiment (Lists of Single-Use Credit Card Numbers)

In this embodiment, the device memory 104 includes a database with alist of single-use credit card numbers and a flag for each numberindicating whether the number has already been used. The single-usecredit card numbers are assigned to the cardholder by the credit cardissuer.

One method to assign single-use credit card numbers is as follows. Thereare 2⁵³ possible credit card numbers. Some sort of central authoritycould assign ranges of account numbers to individual credit cardcompanies. Once a company receives an r-bit range of account numbersthey can further split the range of numbers up however they please.Ultimately, the credit card company would decide upon the size of thenonce (N bits), the account number (A bits), and the size of the IV (mbits) so that n+a+m=r. The account number would include those bitsassigned by the central authority. Also, different card holders can havedifferent values of n, a, and m even if they received their cards fromthe same credit card company. It is simply up to the company to keeptrack of the appropriate information.

After a card holder's card expires their account number can be reused.The next credit card issued with that account number should use adifferent nonce and private key. This will ensure that any credit cardnumbers generated with the old credit card will not match any new creditcard numbers with better than random chance.

The steps for obtaining a single-use credit card number according tothis embodiment are shown in FIG. 10. In step 1001, the cardholderenters his unique identifier (for example, a PIN or biometric data) intothe device. The device determines whether the identifier is valid forthe device (step 1002); if not, access to the device is denied (step1004). If the identifier is valid, the device searches the single-usecredit card number database in the device memory 104 for a single-usecredit card number (step 1003). If a single-use credit card number isavailable (step 1005), it is displayed on the device display screen 102(step 1007); if not, a message is displayed instructing the cardholderto obtain a new device (with a new list of single-use credit cardnumbers) from the credit card issuer (step 1006). The database in thedevice memory 104 is then updated to change the status of the numberfrom “not used” to “used” (step 1008).

A schematic diagram of the credit card issuer's central processoraccording to this embodiment is shown in FIG. 12. The processor 1200includes a central processing unit (CPU) 1201. The CPU is connected to aclock 1202, a random-access memory (RAM) 1203, a read-only memory (ROM)1204, and a communication port 1206 for communication with themerchant's central processor, similar to the first embodiment. Inaddition, the CPU 1201 is connected to a data storage device 1210, whichincludes a credit card account holder database 1211, a credit cardnumber database 1212, and a credit card transaction database 1213. Thecredit card account holder database 1211 has the same structure asdatabase 411.

The fields of the credit card number database 1212 are shown in FIG. 13.Each cardholder account number 501 is associated with the cardholdername 502 and a list of credit card numbers 1301; each credit card numberhas associated therewith its status 1302 (used or not used).

The fields of the credit card transaction database 1213 are shown inFIG. 14. Each record of this database corresponds to one transactionusing the card, and includes the account number 501, the expiration date507 of the card, the transaction amount 702, and the merchantidentification number 703.

The steps for generating an authorization code for a credit transactionin this embodiment are shown in FIGS. 11A and 11B. In step 1101, thecardholder provides the merchant with a single-use credit card numberdisplayed on the device (see step 1007 of FIG. 10). The merchant thentransmits the single-use credit card number and the transaction amountto the credit card issuer's central processor 1200 (step 1102). Thecentral processor searches the credit card number database 1212 toidentify the account holder of the transmitted single-use credit cardnumber (step 1103), and determines whether the transmitted credit cardnumber matches a credit card number listed in the credit card numberdatabase (step 1104). If there is no match, the credit card number isconsidered invalid, and the transaction is aborted (step 1105). If thereis a match, the credit card number is considered valid, and the centralprocessor checks the status 1302 of the credit card number to determinewhether the credit card number has already been used (step 1106). If so,the number is no longer valid, and the transaction is aborted (step1107).

If the cardholder's account meets the credit card issuer's approvalcriteria (step 1121), then the issuer's central processor generates anauthorization code and transmits the code to the merchant (step 1123).If not, the transaction is aborted (step 1122). Finally, in step 1124,the issuer's central processor changes the status 1302 of the creditcard number from “not used” to “used.”

While the present invention has been described above in terms ofspecific embodiments, it is to be understood that the invention is notlimited to the disclosed embodiments. On the contrary, the presentinvention is intended to cover various modifications and equivalentstructures included within the spirit and scope of the appended claims.

1. A method for generating a single-use financial account identifier,comprising the steps of: accessing a first data element, specific to anaccount; accessing a second data element including transaction-specificdata; and combining said first data element and said second data elementto produce said single-use financial account identifier.
 2. The methodof claim 1 wherein the step of accessing said first data elementincludes accessing an account identifier.
 3. The method of claim 2wherein said account identifier is alpha-numeric.
 4. The method of claim1 wherein the step of accessing said second data element includesaccessing a time.
 5. The method of claim 1 wherein the step of accessingsaid second data element includes accessing a payment amount.
 6. Themethod of claim 1 wherein said step of accessing said second dataelement includes accessing a merchant identifier.
 7. The method of claim1 wherein the step of accessing said first data element includesencrypting said first data element.
 8. The method of claim 7 wherein theencrypting step is based on a private key encryption technique.
 9. Themethod of claim 1 wherein the combining step is based on a hashingfunction.
 10. The method of claim 1 wherein the combining step includesencrypting said first data element and said second data element.
 11. Themethod of claim 10 wherein the encrypting step is based on a private keyencryption technique.
 12. The method of claim 1, further comprising thestep of accessing a third data element including a static accountidentifier, and wherein said combining step includes combining saidthird data element with said first data element and said second dataelement.
 13. The method of claim 1, further comprising the step ofupdating said second data element to initialize for a futuretransaction.
 14. A device for facilitating a financial accounttransaction, comprising: a processing unit, said processing unitincluding a cryptographic processor; an input unit connected to saidprocessing unit for inputting information thereto; a display unitconnected to said processing unit for displaying a processing resulttherefrom; and a memory device connected to said processing unit, saidmemory device containing a private cryptographic key, a first dataelement, a second data element and a program, adapted to be executed bysaid processing unit, to encrypt the first data element using theprivate cryptographic key and the second data element, modify the seconddata element, combine the encrypted first data element and the seconddata element to generate a single-use financial account identifier, anddisplay the single-use financial account identifier using said displayunit.
 15. An apparatus for facilitating a financial account transaction,comprising: a processing unit; an input device connected to saidprocessing unit for inputting a financial account identifier thereto; atransmitting/receiving device connected to said processing unit fortransmitting the financial account identifier for verification thereofand for receiving information regarding authorization of thetransaction; and an output device connected to said processing unit foroutputting the information regarding authorization of the transaction,wherein the financial account identifier is a single-use financialaccount identifier containing information specific to the transaction.16. An apparatus for verifying a financial account identifier,comprising: a processing unit, said processing unit including acryptographic processor; a communications unit, connected to saidprocessing unit, for transmitting and receiving information regardingthe financial account identifier; and a memory device connected to saidprocessing unit, said memory device containing a private cryptographickey, a first data element, a second data element and a program, adaptedto be executed by said processing unit, to receive a single-usefinancial account identifier, extract therefrom a third data element anda fourth data element, decrypt the third data element using the privatecryptographic key and the fourth data element, compare the decryptedthird data element with the first data element in a first comparison,compare the fourth data element with the second data element in a secondcomparison, and verify the received financial account identifier inaccordance with the first comparison and the second comparison.
 17. Amethod for generating a single-use financial account identifier,comprising the steps of: providing a memory device containing a privatecryptographic key, a first data element, and a second data element;encrypting the first data element using the private cryptographic keyand the second data element; modifying the second data element;combining the encrypted first data element and the second data elementto generate a single-use financial account identifier; and displayingthe single-use financial account identifier.
 18. A method forfacilitating a financial account transaction, comprising: providing aprocessing unit; inputting a financial account identifier to saidprocessing unit; transmitting the financial account identifier forverification thereof; receiving information regarding authorization ofthe transaction based on said verification; and outputting theinformation regarding authorization of the transaction, wherein thefinancial account identifier is a single-use financial accountidentifier containing information specific to the transaction.
 19. Amethod for verifying a single-use financial account identifier,comprising the steps of: providing a memory device containing a privatecryptographic key, a first data element and a second data element;receiving said single-use financial account identifier; extracting fromsaid single-use financial account identifier a third data element and afourth data element; decrypting the third data element using the privatecryptographic key and the fourth data element; comparing the decryptedthird data element with the first data element in a first comparison;comparing the fourth data element with the second data element in asecond comparison; and verifying said single-use financial accountidentifier in accordance with the first comparison and the secondcomparison.
 20. A device for providing a single-use financial accountidentifier, said device comprising: a memory storing data representing aplurality of predetermined single-use financial account identifiers,data representing a status for each of said plurality of predeterminedsingle-use financial account identifiers, and data representing apointer to one of said plurality of predetermined single-use financialaccount identifiers; an output device for presenting said single-usefinancial account identifier; and a processor coupled to said memory andto said output device, said processor being configured to identify saidsingle-use financial account identifier based on said data representinga pointer, said processor being further configured to transmit a signalto said output device to present said single-use financial accountidentifier.
 21. A device according to claim 20, further comprising aninput device adapted to transmit an input signal representing a requestto present said single-use financial account identifier, wherein saidprocessor is coupled to said input device and said processor is furtherconfigured to receive said input signal from said input device.
 22. Adevice according to claim 20, wherein said processor is furtherconfigured to update said data representing a pointer and to update saiddata representing a status.
 23. An apparatus for verifying a single-usefinancial account identifier, comprising: a processing unit; acommunications unit, connected to said processing unit, for transmittingand receiving information regarding said single-use financial accountidentifier; and a memory device connected to said processing unit, saidmemory device containing data representing a plurality of predeterminedsingle-use financial account identifiers, data representing a status foreach of said plurality of predetermined single-use financial accountidentifiers, and a program, adapted to be executed by said processingunit, to receive said single-use financial account identifier, comparesaid single-use financial account identifier with each of said pluralityof predetermined single-use financial account identifiers to identifyone predetermined single-use financial account identifier matching saidsingle-use financial account identifier, and verify said single-usefinancial account identifier in accordance with said comparison and thedata representing the status of said one predetermined single-usefinancial account identifier.
 24. A method for providing a single-usefinancial account identifier, comprising the steps of: providing amemory storing data representing a plurality of predetermined single-usefinancial account identifiers, data representing a status for each ofsaid plurality of predetermined single-use financial accountidentifiers, and data representing a pointer to one of said plurality ofpredetermined single-use financial account identifiers; identifying saidsingle-use financial account identifier based on said data representinga pointer; and transmitting a signal to an output device to present saidsingle-use financial account identifier.
 25. A method for verifying asingle-use financial account identifier, comprising the steps of:providing a memory device containing data representing a plurality ofpredetermined single-use financial account identifiers and datarepresenting a status for each of said plurality of predeterminedsingle-use financial account identifiers; receiving said single-usefinancial account identifier; comparing said single-use financialaccount identifier with said plurality of predetermined single-usefinancial account identifiers to identify one predetermined single-usefinancial account identifier matching said single-use financial accountidentifier; and verifying said single-use financial account identifierin accordance with said comparison and the data representing the statusof said one predetermined single-use financial account identifier.